Europe's 100 hottest startups 2012: Helsinki

This article was taken from the September 2012 issue of Wired magazine. Be the first to read Wired's articles in print before they're posted online, and get your hands on loads of additional content bysubscribing online.

In 1992, young Helsinki programmers founded the Demoparty, in which they produced visual presentations set to loud music and competed against each other through the cold nights. The event is still going strong, but its competitors have grown up and built gaming companies instead of demos -- developers such as Rovio, Remedy and GrandCru all have founding members from the scene. But Helsinki's tech boom stretches beyond gaming: in Arctic Startup, it has its own tech media, and the Startup Sauna incubator has boosted new businesses such <span class="s2">as Campalyst and Ovelin.

Its position in Europe makes access to Russian and Chinese markets easier than for businesses in London and Berlin.

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The Finnish government actively supports and invests in startups (it funds Startup Sauna too), in an attempt to replicate the Israeli startup boom.

1: Ovelin

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Gallery: Europe's 100 hottest startups 2012: Helsinki

ByTom Cheshire

4th Floor, Vilhonkatu 5, Helsinki

Chris and Mikko Kaipainen started taking guitar lessons at university, but didn't keep them up. They founded Ovelin instead: "We realised that many of the existing products and self-learning concepts did not support in any way the most important area in the early phase of instrument learning -- the motivation to practise." Mikko says that 85 per cent of people who start an instrument give it up before they reach a reasonable standard. Ovelin's first product, an iPad app called WildChords, is an attempt to make learning more fun for that 85 per cent - and turn them into real-life guitar heroes. In it, animals escape from the zoo: only by playing guitar chords can users entice them back in. WildChords had 100,000 downloads in its first month.

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Ovelin's first funding was a loan from Tekes, a public fund in Finland for financing research and development. This year, the 11-strong company raised $1.4 million (£900,000) in funding from True Ventures. It will use that cash to expand its apps in 2012 to other instruments and platforms -- any device that can run Skype, according to the founders. The ultimate aim? "To make the world a more musical place."

2: Kiosked

Keilaranta 1, 02150, Espoo

Kiosked hates banner advertising. "The internet was designed as an interactive, dynamic marketplace, but old media cornered it with traditional advertising. Banners don't work, they annoy the customer," says CEO and cofounder Lars-Michaël Paqvalén. "We want to take it back." Kiosked's solution? Turn all online content into a marketplace. The company, in stealth for the last three years, has a database of images that are freely available to blogs and other websites. If someone browsing the web likes the shoes, say, in a Kiosked-supplied image on a blog, hovering a mouse over them will take them to the web store; hovering over the jeans in that photo will do the same.

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Videos and games can be Kiosked, and users can share this content across the web or Facebook. Why would they bother? Paqvalén says that they already do, but a recent partnership with One Piece, a clothes retailer, means that any consumer who shares content that leads to a sale (Kiosked has built the back end to track precisely this) earns €10.

Kiosked has 50 employees, with $5.75 million from investors including Kaj Hed, who serves as chairman of both Rovio and Kiosked, and the startup recently opened UK and US offices. It has signed up 10,000 brands, individuals and companies to the service, including Rovio and Snoop Dogg, and at the time of writing 135 million "kiosks" have been visited. Next up, it's doing the same for live, internet-enabled TV - part of its ultimate mission to revolutionise e-commerce. "Our vision is that anything you see can be yours."

3: Tinkercad

Aleksanterinkatu 15, Helsinki

On Tinkercad, the brainchild of former Google engineer Kai Backman, users can design 3D-printed objects in their browser. Unlike other products such as SketchUp, it requires no download. If the user doesn't have a printer, the company, which has $1 million in seed funding, will print the digital designs and ship the physical product. Designs are shared under a Creative Commons licence and minigames teach users the basics of designing in 3D.

4: Audiodraft

Vanha Talvitie 11c, Helsinki

Audiodraft is a platform for crowdsourcing music: for a $99 fee, businesses post briefs on the site and composers submit their entries. When Nokia used the service to create a new ringtone last year, it had more than 6,000 submissions. Audiodraft recently expanded its offering with a marketplace for high-quality music available to license exclusively: a one-year licence costs $400. The company is hoping to take a bite out of the $5 billion custom-audio industry.

5: Grand Cru

Påivitetty Maa 12, Helsinki

Social-games developer Grand Cru has raised $2 million in funding -- from French venture capital firm Idinvest Partners and investor Anil Hansjee -- without even releasing a game. Its first title, The Supernauts, comes out, as a private beta, later this year and will be able to be played across any device on web, iOS and Android platforms. The game takes its inspiration from Minecraft and will use the same constantly iterative production process.

6: Mendor

Keilaranta 16, Helsinki

Mendor says it is leading the way in "the new diabetes movement". Its first product, called Discreet, is an all-in-one blood glucose meter that contains all the components needed for daily blood-sugar measurements. It's backed up by Mendor Balance -- web-based software which allows users to access and analyse their data from any device. The company recently raised €8.1 million (£6.5 million) in a series-B round.

7: Powerkiss

Melkonkatu 24, Helsinki

PowerKiss is building wireless phone-charging into your furniture. Consumers buy a "Ring" for

¤16.60 and businesses buy the "heart", which converts surfaces into charging spots. Founded in 2008, the startup is part of Nokia's innovation mill -- an incubator that gives access to the company's unexploited business ideas and IP holdings. It launched the Ring in June 2010 and an iPad version this year. Partners include Nokia, Wayne's Coffee and Vodafone.

8: Steam Republic

Linnanrakentajantie 4d, Helsinki

Steam Republic's Mobile Backstage platform, launched in July 2010, connects a pop star's mobile, Facebook and web fan-communities, allowing users to exchange information, find and buy tickets to gigs and stream music or buy it from iTunes, all in a bespoke mobile app. Jessie J, Tinie Tempah and Lykke Li all use the service and it generated more than 100 million page views in 2011; in May, the company raised another funding round of €1 million.

9:ThirdPresence

Rahakamarinportti 3a, Helsinki

Most modern phones can play video, but they all play it in different formats. ThirdPresence, which in April raised $800,000 in seed funding from a combination of investors including a former CEO of Nokia, offers a white-label tool that lets companies upload videos to their system, then distribute them across different devices. Clients include media groups RTL Nederland and The Voice TV.

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10: Grey Area

Kaisaniemenkatu 6a, Helsinki

Grey Area turns cities into videogame levels, with debut title Shadow Cities, a location-based multiplayer online game, played in 40 cities around the world. The company is using €2 million of backing from VC firms including Index Ventures to work on its next title, released later this year. It has gone from three founders to 16 employees: "More muscle to build our vision of a global games layer," says cofounder Ville Vesterinen.

This article was first published in the September 2012 issue of WIRED magazine